It was great to see so many of you attend our open house on March 5^th. The photo exhibit of Italy by Jules Reuter was enjoyable; as were the wines he poured and talked about. Thank you for attending and helping us celebrate our new office.

A positive month for the market

March gave us a 23.11% return in 13 trading days: the best since 1938.  The market surged over the past two weeks as we began to see signs of recovery and hope from several sectors of the market. The key indicator is the trend in payroll, excluding farming. The highest month for job loss was December with 681,000. January continued with 655,000 jobs lost. February had another 651,000 jobs lost in that month. Each month is a smaller number of jobs, even though the number of jobs lost is astounding. March data is being released on April 3^rd, but ADP is estimating 730,000 jobs were lost verses the Labor Department’s estimate of 663,000. The most jobs lost in 2009 have been in New York but the sectors that have the biggest losses are financial, automotive and retail. Another key trend indicator is volume. I will believe the rally has depth when I see a significant increase in volume with rising prices. This means new buyers are coming into the market.

The banks led the market rally during the week of March 17th to 31st.  When banks appear to stabilize and look forward to profitable status, the market rallies. Several banks have begun to talk about repayment of their TARP money, which is a very good sign. I think the banks have now realized how hampered they are if they continue to operate with TARP money. Their incentive bonus pool is dry, their CEO’s (and other executives) salary is under a microscope and they are being watched by very angry public shareholders.  President Obama and Congress lashed out at AIG and made their bonuses subject to a 90% tax.

“In any moment of decision, the best thing you can do is the right thing, the next best thing is the wrong thing, and the worst thing you can do is nothing.”––Teddy Roosevelt

Asset Planning Blog – Our current thoughts

Are you signed up? When you sign up and confirm, a copy of the blog is email directly to you. I do try and post at least once per week and Carol also recently blogged about the proposed tax changes. Since this newsletter comes quarterly, the blog is my way of staying in touch with current events or changes. I also try and explain what is going on in Washington with the Federal Reserve Board, Congress or Tim Geithner, from my perspective.   Things are changing so quickly on a daily and weekly basis;  you can keep in touch from our blog.  Go to www.AssetPlanningInc.com and click on blog to sign up.

Mark- to- market and uptick rule

I think the market has already anticipated the restoration of the mark-to-market rule. This would help give the banks more flexibility in putting a value on mortgage assets they are holding that do not have a ready buyer at this time. The assets may have value and cash flow but if a buyer is not able to come forward to purchase it, it does not have liquidity and cannot be sold in today’s market and must be marked down in value to reflect that. This rule would restore some value on the banks balance sheet and lessen pressure to raise more capital. This vote will take place April 2^nd.

The uptick rule is something that never should have been removed by Christopher Cox’s SEC.  (See my quarterly comments in April 2008!) When this rule was removed, it allowed the naked short sellers to pummel a stock to the ground. This means you could sell a stock you did not own (naked) and continue to drive the price down. The uptick rule was in place and meant you could not sell a stock until the stock had risen at least 1/8^th in price- thus an “uptick” in the price. This stopped many of the short sellers. Stock prices have been driven down and it must be reinstated by Mary Shapiro, the new SEC chair.  

Asset Planning in the news

In a consumer survey conducted through Orange Coast Magazine, Sandy was nominated as a “ FIVE STAR: Best in Client Satisfaction Wealth Manager”. Our deepest gratitude goes out to our clients that made this honor possible. Details on the survey are enclosed and you can look for us in the 2009 March issue of  Orange Coast Magazine.

      "Our attitudes control our lives.  Attitudes are our secret power working twenty-four hours a day, for good or bad.  It is of paramount importance that we know how to harness and control this great force."             Tom Blandi